Colorado § 31-31.5-501 - Vesting.

§ 31-31.5-501. Vesting.

(1) A member is one hundred percent vested in the individual account in the money purchase benefit account pursuant to section 31-31.5-503.

(2) Employer contributions made to the statewide retirement plan that are credited to the money purchase component account are subject to the following vesting rules:

(a) In the event of permanent occupational or total disability retirement or an award of a survivor benefit due to a death of an active member pursuant to part 8 of article 31 of this title 31, a member shall be one hundred percent vested in the employer contributions made to the money purchase component account.

(b) A member shall be one hundred percent vested in the employer's contributions made to the money purchase component account upon attaining normal retirement age if employed by the employer on or after that date.

(c) Except as provided in subsections (2)(a) and (2)(b) of this section, a member is vested in the employer contributions made to the money purchase component account in the amount of twenty percent for each full year of service performed for a covered department. Upon attaining five full years of service, a member is one hundred percent vested. Vesting also applies to employer contributions allocated pursuant to section 31-31.5-301 (3) or allocated under the predecessor statewide defined benefit plan pursuant to section 31-31-405, as it existed prior to its repeal.

(3) Upon distribution, the portion of the member's employer contributions to the money purchase component account that is not vested shall be treated as a forfeiture.

(4) (a) Years of service in the money purchase component for purposes of this section cannot be purchased by the member or the employer.

(b) A member who only participates in the money purchase component does not receive service credit for purposes of the lifetime benefit components.

(c) For members who participate in both the lifetime benefit components and the money purchase component concurrently, years of service include all years of service with the employer while in the plan or a predecessor plan, regardless of whether contributions were made to the money purchase component for each year.

(5) A member who is restored to active service after a disability ceases to exist receives credit for years of service in the money purchase component with the employer prior to the disability as well as time while out on disability.

(6) Subject to rules adopted by the board, years of service of a member who is employed by successive employers may be aggregated for determining eligibility and benefits provided by the money purchase component of the statewide retirement plan if the service for each employer was rendered while the employer covered its members under the statewide retirement plan, the predecessor statewide defined benefit plan, or the predecessor statewide hybrid plan.

Source: L. 2022: Entire article added, (HB 22-1034), ch. 61, p. 295, § 1, effective August 10. L. 2024: (2)(c) amended, (HB 24-1042), ch. 15, p. 40, § 13, effective March 6.